This research is focused on manufacturing performance measurement
systems in general and, particularly, Overall Equipment Effectiveness (OEE)
and Process Capability Analysis (PCA). Two improved approaches, namely:
Overall Equipment Effectiveness Plus (OEE+) and Overall Resource
Effectiveness (ORE), are proposed, developed and evaluated. Also, the
relationship between the overall effectiveness of a machine or process and
its capability is investigated. '
OEE provides, according to many authors and practitioners, an effective and
appropriate quantitative measure of the overall performance of a machine or
process. OEE is defined based on the time-based elements of Availability
(~), Performance (P) and the unit-based element of Quality (Q). However,
this research demonstrates that, while these three elements are important,
other factors also have a significant contribution to process performance. For
example, the efficient use of raw materials as well as the environment (e.g.
production system, logistics, labour, etc.) in which the equipment or process
?perates can also be important. By definition, OEE is unable to evaluate and
Identify improvement opportunities in these areas. Consequently, OEE+ and
ORE are defined in order to provide a more complete and improved measure
?f overall effectiveness. Also, an investigation of the process capability
Impact on overall effectiveness is carried out through this research. The
technical characteristics or properties of OEE, OEE+ and ORE are analysed
an~ ,compared for a range of product characteristics and manufacturing
poliCies using a defined set of experiments run on a discrete-event simulation
model of an automated bottling line. The relationship between overall
e~ectiveness and process capability is also investigated using the bottling
simulation model and the experimental design technique Taguchi method in
the form of orthogonal arrays.
The research concludes that OEE is an inappropriate measure of
~e~or~ance for some manufacturing processes. The weaknesses and
limitations of OEE are defined and demonstrated. ORE is demonstrated to be
a more complete and improved evaluation of overall effectiveness when
compared with OEE or OEE+. Furthermore, ORE provides managers with a
~roader perspective of their processes and, consequently, enables them to
ake better decisions about how to run and improve their processes more
~ffectivelY and effiCiently. Finally, the research illustrates the relationship
e~een overall effectiveness and process capability and suggests the
eXlste~?e of a "breaking point" beyond which improvements in process
capability have little impact on the overall effectiveness of a process.